a. Does the sample data provide evidence to conclude the more than 60% of the banks loans are made to persons residing in Crooked Arrow (using alpha=0.01)
1. Formulate the null and alternative hypotheses.
2. Determine the criterion for rejection or non-rejection of the null hypothesis.
3. Calculate the test statistic.
4. Compare the test statistic to the rejection region and make a judgment about the null and alternative hypotheses.
5. Interpret the statistical decision in terms of the problem.
6. Compute the observed "p" value in the hypothesis test and interpret this value. What does it mean?